Business Growth


Running a business without a business plan is like rock climbing blindfolded. Your chances of making it successfully to the top are slim. And the process will surely be a death-defying one.

Contrary to popular practice, a business plan is not a means to securing financing. Instead it is a step-by-step guide to running your business and creating the product or service that will make it in the marketplace. And like any other map, your plan will have to be adjusted according to your vision for the company, conditions and opportunities in the marketplace and your business’ current condition.

Whether it’s formal or informal, every business has a plan. The local hair salon may not have formally written down the plan, but before setting up shop, a smart owner would have assessed the need for a shop in that area of town, the ability to attract clients there, the appropriate amount of chairs, whether to hire someone to do the shampooing and sweeping, the cost of utilities, the parking availability for clients. The owner who waits to figure these things out using trial and mostly error will be lucky to be left with his/her wits, much less any customers. A business plan helps to minimises those pitfalls.

To many people, the concept of writing a business plan for their own business is a daunting one. Perhaps it would appear less daunting to view the process as simply writing the answer to three questions, namely:

1. Where are you now?
2. Where do you want to be at a future date?
3. How will you get there?

THE FIRST QUESTION – ‘Where are you now?’ – must be your starting point. This question seeks to provide a planning base. It looks at your business to establish such things as: „

– your business idea „
– your current level of sales „
– your customer groups „
– your products and services „
– your pricing policy „
– your distribution policy „
– your promotional activity „
– your overall operation „
– your team members „
– your finances
Answering the question, “Where are you now?” is often a major stumbling block because most people don’t know where to start. However, the answer is surprisingly simple if you divide your business planning into four key areas: Operational, Marketing, Employees and Finance. Such a division allows you to analyse your business (or assumed business) to create a solid planning base.

THE SECOND QUESTION – “Where do you want to be at a future date?” is simply asking you to visualise your business operation at a set date in the future. This visualisation process is almost identical to the exercise of setting personal objectives. The difference, however, is that the focus here is on business objectives.

THE THIRD QUESTION – “How will you get there?” asks about the steps you need to take in order to achieve the business objectives you have set. These steps, or strategies, can be identified, written down and programmed. Additional things a business plan should consider:

1. What is a reasonable expectation of profitability and when?
2. How will the business pay you and any team members?
3. What are estimated expenses?
4. What is the pricing strategy?
5. What is the need for what you are offering and what profit margins can you expect?
While much of this may have occurred to you informally, it is very import to write it down. If you ever need to approach a bank or investors, you will need it. Writing it down will reinforce your vision, give you a reference point for checking your business’ progress and will most likely bring up factors you did not consider when creating the plan in your head.

Writing your business plan down:

1. Helps you determine and coordinate all aspects of business operations
2. Gives you a means to analyse and determine what might be the best change to boost your business out of a stagnant situation
3. Assists you in determining the risks and benefits associated with any changes
4. Decreases your chances of making a mistake or not considering important factors in your business, and most importantly,
5. Dramatically increases your chances of success.

Business plans are not only for those just setting out their journey in the marketplace. They are useful when acquiring a new business, forecasting growth, introducing a new product or service, entering a new market, responding to changes in the market or changing a significant aspect of your business.



If you don’t know, your customers surely don’t. More importantly, if you don’t know, you won’t be able to tell your customers why they should choose you over your competitors. Answering this simple question is critical to forming a purpose statement and creating your marketing strategy.

What was your purpose in starting your business?

Undoubtedly when you decided to start your business you had an inspiration. Was it to provide a service or product better, faster or cheaper than what was currently available? Was it to fill a gap in the marketplace? Perhaps you were inspired to run a business that people enjoyed working for or that maintained environmentally and socially responsible ethical standards or that surpassed existing companies in providing superior customer service. Whatever your mission, find it and then write it down.

The Power of Why

Experience shows that companies with a clear and ever-present purpose statement surpass their competition and last in the marketplace. Purpose (or Why) statements define and preserve and strengthen a company’s unique competitive advantages. Additionally, companies who are clear about who they are and what they do are less likely to make irrational decisions in response to competition and fluctuations in the marketplace. However, that does not mean your purpose statement should be inflexible. A good purpose statement can lead a company for 10 to 20 years if time and effort were spent in creating it. However, re-evaluating your why from time to time to see if it is still relevant, significant and appropriate is advised.

Be Specific

You want to create a statement that you and your team can look to every day and ask “Am I fulfilling the company’s mission?” For example, one statement could be “to be the leading game software developer for teens”. A more actionable purpose statement would be “Surpass XYZ games developer in sales, customer experience and speed to market”. The second purpose statement has clear goals and direction, while the more abstract version would be more appropriate for a vision statement than a purpose statement. The second statement clearly supports the vision statement.

Include a Call to Action

You can distinguish your purpose statement by including a call to action. This is missing in most company purpose statements and has several defining and distinguishing characteristics:

  • It motivates and generates an emotional reaction from your team
  • It is easy to understand and translates into what your employees do every day
  • It states a goal that can be measured and identified easily
  • It reflects and is rooted in the competitive environment in which your company functions

Think back to this statement: “Surpass XYZ games developer in sales, customer experience and speed to market”, if you run this statement through the above four qualifications, you will get a yes every time.

Creating a Purpose Statement that Fits Your Business

When creating your purpose statement, consider these aspects of your business:

  • What is your company’s history and tradition? How does it influence what you want to accomplish today and in the long term?
  • How do you characterize the management philosophy of the company? What input does management have in the direction of the company?
  • What distinguishes your company from all of the other companies that perform the same service or function? How do you already surpass the competition? What can you do to continue surpassing them?
  • What goals are realistic when considering the available resources?
  • Where do you need to improve in order to beat the competition? What are your competitors doing that you can imitate and improve upon?
  • And perhaps most importantly – what impact do you have on your customers’ lives?

Rocket to success

You may have the greatest product ever but if you don’t tell the world, it will sit on the shelves collecting dust until you finally have to close your business. Remember, you know what is great about your business because you created it. The rest of the world is not thinking about you and what you have to offer. So you have to tell them and you have to tell them in a way that makes them want what you have to offer.

Many small businesses shy away from promotions thinking they can’t compete with the advertising, public relations and promotions budgets of their large competitors. But good promotions do not have to be expensive. And if you stay focused and create a clear plan, they don’t have to be time-consuming either.

First develop a plan. This should be included in your business plan. Here are the steps to developing a strong promotional plan:

Identify your target buyer

Consider what kind of customer you want to do business with and to whom your product or service is most likely to appeal. Take into account demographic (i.e. age, gender, location, marital status), lifestyle (i.e. athletes, club goers, outdoor enthusiasts) and psychographics (i.e. personality traits and emotions that affect buying decisions) information.

Make Them Want What You Have to Offer

Distinguish your product or service from all the rest. This has to be meaningful and accurate, otherwise you will lose credibility with your consumers. First you will need to know what features, benefits and brand attributes your target buyers consider when making a purchase. For example, if you are a local nursery, your target buyers might take into account return policies on plants that don’t survive, quality of plants in store and availability of informed people who can assist them with plant choices and directions for caring for the plants.

Create a strategy and make it clear

Write down who your target buyers are, what your competitive environment is and what your meaningful differences are. This is called your positioning strategy statement. You must develop a consistent message and look and feel in all of your promotional campaigns.

Think about the personality of your business in relationship to your target buyers. Is it a young, hip, friendly, casual environment? Or is it a more reserved, traditional and slightly more conservative environment? These characteristics will inform the look, feel and tone of your business, as well as promotions.

Create a clear, concise and memorable message that impacts your target buyers

This can be a challenge but doesn’t have to be. Think about your business value proposition (BVP). If you have clearly identified the unique features and benefits of your product/service that truly matter to your target buyers, you will be well on your way. Take this information and brainstorm potential slogans, keywords in all marketing messages and visual images that correspond to your BVP.

Consider your budget

When promoting your products, services and business there may never seem to be enough money. However, not all promotion costs money. Creating a mix between word-of-mouth, customer referral programs, public relations and advertising will save you a lot of money. Imagination and relationship building are the keys.

Accountants - Products

Stephen runs a construction business specialising in large basements and car parks. The business has been established for 25 years and has grown steadily, with revenue now into eight figures. Unfortunately, profit margins are very slim and last year, Stephen’s business barely broke even and he was unable to draw his usual dividend at the year end.

His accountant proposed a half day session focused on the key numbers in the business. Together, they put together a plan to increase revenue by 50% over the next three years without increasing the cost base significantly. The starting point for that plan was to uncover inefficiencies in the business’s processes to shave significant time off the average build, enabling Stephen and his team to do more with less. As the plan was implemented, profitability increased along with revenue.

Stephen’s accountant also got him focused on his receivables. It transpired that on average, it was taking customers 90 days to pay despite agreed terms of 45 days. By crunching the numbers, it became apparent that even a reduction to 60 days with no increase in revenue would improve the cash position significantly, allowing Stephen to take his long-suffering wife on that world cruise he had promised her for the past 10 years.
All in all, a great outcome from a simple planning meeting. If you are frustrated with your revenue, profitability or cash flow, contact us today and we’ll be in touch to discuss how we can help.

Growth - manage growth

Many small business owners are entrepreneurs who went into business seeking freedom, a better lifestyle, more money or simply because they wanted to run their own show. Financial acumen is rarely high amongst the skills possessed by such people. As such, it is only to be expected that business owners make financial mistakes which can jeopardize their dreams. Here are four of the most common mistakes and how business owners can avoid them.

  1. Failing to plan

Few small businesses have a working budget and cash flow forecast which is rolled over on (at least) a quarterly basis. As a result, they make decisions based on guesswork and have no idea whether their business’s actual performance is better or worse than what they expected. A solid budget requires the following information, ideally seasonalised and presented on a month by month basis:

  • Sales – not just a lump sum figure, but broken down by product or service line and calculated as number of sales multiplied by average sale value
  • Variable costs – these are costs that vary with sales and as such, should be driven by your sales forecast
  • Fixed costs – unless there are any significant changes, these can be taken from your most recent financial statements and adjusted for any known or expected increases

Once you have developed a budgeted profit and loss account, you should then create a cash flow forecast. This differs from the profit and loss budget because it is looking at the cash inflows and outflows. As such, it needs to take account of how long your customers take to pay you, how quickly you turn over inventory, how quickly you pay your suppliers, any loan repayments due and any forecasted capital expenditure that will not appear in the budget profit and loss account.

For a thorough budget that could be presented to a bank for the purpose of raising finance, you should also complete a budgeted balance sheet.

  1. Financing capital expenditure out of cash flow

As a general rule, and to the extent that it is possible, it is good practice to cash flow the lifetime of a purchase. By that we mean this: if you are buying stock to sell in the short term, then finance it out of your day to day working capital. But if you are buying a large piece of machinery with a ten year life, then you should look to finance it over ten years. Similarly, don’t fall into the trap of many small business owners where you have a good quarter and go out and buy yourself a flash new car – out of cash flow. Unless you are confident (and have evidence to back it up) that your strong sales will continue, you could find yourself in a cash flow bind if you empty the bank account to buy new assets every time you find you have a bit of surplus cash.

Form a strong relationship with a bank manager and keep them up to date with your plans. Often, the banks will be happy to lend when times are good for your business and you should take advantage of that to properly finance any capital expenditure required to expand your business. Similarly, the best time to secure an overdraft is when you don’t need it. The banks will be more willing and able to help you out and then if you hit a rough patch, you have a safety net.

  1. Cutting costs rather than driving revenue

When considering how to improve profitability, many business owners resort to hacking at costs. That’s all very well, but there is a finite limit to which expenses can be cut – zero. And then you have no business. On the other hand, the opportunities to grow revenue, assuming you manage your growth within the constraints of your cash flow, are limitless. It comes down to understanding the drivers of revenue, which in most businesses are:

  • Number of customers
  • Number of times those customers buy from you
  • The average sale you make each time a customer buys

Once you understand the drivers, you can put in place strategies to increase each of those critical measures.

Another thing to be aware of when reviewing costs, which, of course, is still a valid strategy, is knowing where to cut. For example, too often businesses cut back on marketing which can often be the last place you should be making cuts. Similarly, a knee jerk reaction to cut back on travel expenses could see an adverse reaction (a recent study conducted by Oxford Economics and commissioned by the US Travel Association found that 57% of businesses surveyed felt that cutting their travel costs during the recession in the US hurt their business.)

  1. Running your business from a spreadsheet

Quite possibly the most important to avoid of all of the mistakes listed. In this era of Cloud accounting solutions accurate management information integrated with daily bank feeds is readily available. Not to take advantage of such information is to run the business by the seat of your pants. Yet many small businesses persist in keeping their records on a spreadsheet or worse, in a shoe box!

Talk with your accountant today if you feel that your accounting records are inaccurate, unhelpful or obsolete. In fact, your accountant can help you avoid all four of the key financial outlined in this article, helping to set you up for more profitable days ahead.


Strategy pic


Strategy in its most straightforward definition is a high level plan to achieve one or more goals or an overall position during a period of time.

Strategy, being fundamental to the success and sustainability of any organisation is underpinned by quality operational plans and key performance indicators. Having a strategy that is supported by these elements is important because the resources available to achieve strategic goals are usually limited.

Two approaches – strategic and operational – are most often used by boards of directors to plan and respond to different situations and map a path forward.

A challenge for many organisations is that the board does not execute a strategy that is clearly attached to quality operational targets, clear key performance indicators across all levels of operation and realistic timeframes.

Ultimately, the outcome is a strategy not cohesively implemented and strategic goals left unmet.

How does an organisation overcome this challenge? By developing a strategic plan that entirely depicts the long-term vision and which is underpinned by realistic and measurable operational objectives around budget, results and timeframes.

An effective strategy provides the organisation and its staff with a common purpose, goals and a set of actions to achieve the objectives outlined. It ensures that everyone is working for the same outcome. Providing staff with an understanding of their destination, their individual purpose and the course they’re taking to get there equips them to focus and prioritize.

Done well, strategy is about paving the path for an organisations success and providing it with the tools and time to get there. A well-formulated strategy will enable increased growth, productivity and profit both now and into the future.

McCarthy Advisory, have worked alongside many clients ranging from property, business and trusts. We have helped implement effective strategies at a board level through to an operational level.

If you want to make this year your most outstanding yet, and if one or all of the above challenges resonates, contact us direct today.

Retirement image


You’ve already probably heard this before that making additional superannuation contributions reduces your tax but what and how does it work?

Remember that saying – “hindsight is a wonderful thing” but just for once that hindsight is bought to you as a powerful and money saving (hence money making) insight.

If used wisely making the most of your superannuation contributions will be your best investment for tax purposes. Take the time and advice now because you seriously don’t want to be kicking yourself in the future.

Why are you putting it off?

  • Unfortunately, we’ve become a society of instant gratification. If we can’t have it right now, within seconds we refuse to see future benefits. That’s not only sad; it’s lazy.
  • “I’ll just focus on what’s in front of me in my business right now, right here because I just don’t have the head space or mind capacity to think too far into the future”. How is this way of thinking giving you your preferred lifestyle now and into the future? It’s just not a sustainable way of thinking.
  • “One minute the law says this, then it changes all over again – I just can’t keep up”. The most successful people in the world keep up or have a team of people who keep up for them ensuring they are always one step ahead of the game.

Here are just a few examples of how your super becomes even better:

  • Accumulating a balance on earnings on your superannuation? Pay 15% tax that will save (and make) you more money.
  • Did you know you can use your superannuation to help you buy your business premises even if you don’t have the whole amount?
  • With some conditions and if you’re over 55 years of age, you only have to pay 0% tax on earnings if you’re already drawing on a pension. Yes, 0%.

Now for the number crunching to further convince you tax planning strategy works and will increase your wealth.

Say you currently have a taxable income of $200,000.

Scenario 1 without any tax planning looks pretty painful because if you are paying tax at an individual rate you’re up for a rate of up to 47%. So that equates to $67,547 in tax owed and paid for by you. Unlike a plaster; the quicker you rip it off doesn’t make it hurt any less.

Now take a look at scenario 2, with smart tax planning, when you contribute $22,000 of that to Super before 30th June.

Your taxable amount immediately decreases to $178,000. That means in an instant your tax obligations reduce by $7,040.00. That’s not to be sniffed at and that’s what happens with smart tax planning that takes it out of your own name and places it nice and safely back into your Superannuation.

How can you do this we hear you eagerly cry?

  • You need a business
  • You need cash to deposit into your Superannuation
  • You need to do all this before 30th

A few more tips and advice to share:

  • You only pay 15% tax in Super for any contributions and tax deduction claims
  • The 15% gets paid by your super fund once your tax return is filed if you have SMSF or is taken out of your balance when you deposit if from a public super.
  • The limit if you are 48 years old or younger is $30,000 and $35,000 (through to June 30 2017), then proposed $25,000 as proposed by the new budget, if you’re 49 years and over.
  • If you’re making contributions after tax, then the limit increases a lot up to $500,000 (as per the new changes in the budget)
  • You have to have the cashflow before June 30 each year so it pays to plan so you don’t miss out
  • Each Super limit applies per person



Almost everyone that I have ever met in business started out with enthusiasm, hope and the expectation that they would be able to end up with a great business…and the achievement of their most important goals. Maybe they started out with an idea for a product or service, or learnt from what they could see from an employee or clients point of view….and vowed they could do it better.

However they started, is not nearly as important as it is to ask the question … are they coping now? …and are they achieving their goals with balance?

The working and business landscape has changed dramatically in recent times, and it probably will continue to do so. So with this in mind, let’s just take a little time out and refocus on the reasons ‘why’ we have a business and how it is going.

A business can make a great ‘servant’ but a horrible ‘master.’ If you are not careful, it can take all of your attention, drive, and energy and leave you tired and listless for many of the other important areas of your life, like your family, your health and your peace.

So let’s not provide you with ‘glib’ ‘quick fixes’….because really they don’t exist.

Here are a few things for you to consider.

Are you on track to your most important personal goals?

Do you have a clear ‘vision’ on what your personal life should look like, and it your business structured so that you can enjoy that vision?

Have you looked at some of the key variables in your business. Areas that can provide dramatic improvements include:

Your products’ uniqueness….if it is not to make it unique….or you will have to compete on the only differential left….. price.

Your people…how are they serving, and interacting with your clients….are they doing this well?

Your processes...are they user friendly …do they impress or are they cumbersome, long-windedly and boring…seek to re-energise your clients through reconnecting with them!

Make your processes better, more time efficient and simpler.

Your recurring problems or issues. Recurring problems or issues are ‘markers’ for areas to improve. View them as opportunities to implement a new process.

Your promoting of your business and its products and services. Is the quality and quantity of business where it should be?

Your own passion for what you do….do you need to re-kindle that and get a fresh new look at what you do…….and why you are doing it.

Maybe it is time to stop, look at what you are doing, how you are doing….and what you can do about it.

Source Peter Daniels Lead Australia Pty Ltd

Client communication

Federal Budget Summary

The first Budget from the Turnbull government revealed a $39.9 billion deficit for 2015/16 moving to a $37.1 billion deficit for 2016/17 and forecasting a drop to $6 billion by 2019/20.

Treasurer Scott Morrison unveiled an economic plan designed to “build a brighter, more secure future in a stronger, new economy with more jobs”. The Budget centrepiece was a 10-year enterprise plan to boost new investment, create jobs and deliver wage growth, starting with income tax concessions for small and
medium-sized enterprises.

Under proposed changes, the small business entity turnover threshold will increase from $2 million to $10 million from 1 July, 2016, seeing SMEs with an annual turnover of up to $10 million qualify for small business income tax concessions including a lower corporate tax rate of 27.5 per cent and generous equipment write-offs.

Over the next 10 years, the company tax rate will gradually fall to 25 per cent.

The Budget also revealed further investment in innovation and start-ups, initiatives to help young people into jobs and measures to combat tax avoidance.

Middle income earners were among the winners, benefiting from a modest tax cut, however, many of the super tax concessions for higher income earners will be scaled back.

 Super changes

Unlike last year’s Federal Budget which contained very few super changes, the Turnbull government announced over a dozen super changes.

They include a cap of $25,000 per year on concessional super contributions; a new lifetime cap of $500,000 on non-concessional contributions; increasing the number of people subject to a higher tax (up to 30%) on concessional contributions where income is above $250,000; and the introduction of a super transfer balance cap of $1.6 million to limit the amount of accumulated savings an individual can transfer into the tax-free retirement phase.

In line with pre-Budget speculation the government also made changes to Transition-to-Retirement (TTR) income streams by removing the current tax exemption on earnings from 1 July 2017.

Workers who have attained age 60 will still be able to draw a tax free retirement income stream while continuing to work and contribute to super.

Other changes include the abolition of anti-detriment death benefit payments (which represent a refund of a member’s lifetime super contributions tax payments) and the removal of the 10 per cent test for personal tax deductible super contributions.

Women and lower income earners

Under changes to the concessional super contributions cap, individuals with account balances under $500,000 will be able to make additional concessional contributions where they have not used up their caps in previous years.

Unused concessional amounts accrued from 1 July 2017 can be carried forward on a rolling basis for a period of 5 consecutive years.

The measures aim to give workers with relatively low account balances, as a result of broken work patterns, the ability to top up their super.

Women, who commonly take time out from paid work to care for children and are more likely to return to lower-paid, casual or part-time work, will be a key beneficiary of the catch-up scheme given they typically retire with significantly less super than men.

Women will also be key beneficiaries of a planned increase in the threshold for the Low Income Spouse Tax Offset from 1 July, 2017 to $37,000 from $10,800.

The Low Income Spouse Tax Offset provides up to $540 per annum for the contributing spouse, and is designed to boost the super balances of low income spouses, particularly women.

The Budget also featured a Low Income Super Tax Offset (LISTO) to effectively replace the Low Income Contribution Scheme (LISC).

The LISTO will reduce the tax on super contributions paid by workers who earn less than $37,000 a year by providing a tax offset to super funds from 1 July, 2017, based on the tax paid on concessional contributions up to the value of $500.

What’s next?

The vast majority of changes must be legislated and passed through Parliament before they apply. The government’s top priority is to see the proposed company tax cuts and personal income tax cuts start on 1 July, 2016, which will put pressure on Parliament to pass legislation quickly. If you think you may be negatively affected by some of the Budget’s proposed changes, you should consider seeking professional advice.

We can give you a clear understanding of where you stand and how you can manage your cashflow, super and investments in light of proposed changes. We can also ensure you’re not missing out any new benefits you may be entitled to.

Source from Fairway Financial Advice.



Tax planning is designed to review the best tax strategies for you and whether you’re structured in the most effective way. Hold on to more of your money and develop your tax plan now.

Tax can be complicated and you want to make sure your obligations are covered. With you business tax planning service, you can be confident that your tax position is maximised!

Tax Strategies

Whether it’s deferring income to manage a tax burden or bringing forward deduction to the current year to prepay services where applicable, the right tax strategies will ensure you’re using your funds in the most tax effective way for your circumstances.

4 Steps To The Perfect Tax Plan

  1. We’ll work with you to assess the most effective business structure for you
  2. Together we’ll make sure all your records are up to date and accurate
  3. We’ll work out a tax effective plan to manage all your taxes and obligations
  4. We’ll work with you to ensure all your tax strategies are working effectively for you

What We Do

When it comes to your business tax planning we start by making sure you have the right foundation first. We review your business structure and make sure it’s the most appropriate one for you.

From there, we’ll work with you to deal with a range of taxes as well as any tax reforms and measures that might be relevant. We’ll help you implement the right strategies to maximise your tax effectiveness and make sure your money is working hard for you.


Tax planning is important to make sure you get the most out of your business performance! Take a moment to ask yourself the following questions.

  1. Is your current business structure suitable?
  2. Have you acquired or disposed of any taxable assets this year?
  3. Are your records up to date for all expenditure so that all possible deductions can be claimed?
  4. Are you investing any excess cash in a tax effective way?
  5. Are you aware of all the relevant tax reforms and measures applicable to your business?


Speak to McCarthy Advisory about your business tax plan today!